Wells Fargo Sees Stronger Dollar Through 2027 Amid Rate Hike Outlook

Wells Fargo Investment Institute has revised its currency forecasts, predicting additional strength for the U.S. dollar through the end of 2027 due to inflation-driven rate increases from the Federal Reserve.

The firm adjusted its exchange rate target to $1.10-$1.14 from a previous range of $1.17-$1.21 for year-end 2027, indicating a potential decline in value against the euro.

Wells Fargo analysts expect the Fed to implement a full percentage point more in rate hikes into 2027, while other central banks are projected to hold rates steady or reduce them as their earlier rate increases slow economic growth next year.